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Financial Management for Non Profit Organisations

Getting to know your employees better - SARS filing season deadline 2016!



The filing season for the PAYE Employer Annual Reconciliation (EMP501) for the tax year ending 29 February 2016 started on 18 April 2016 and closes on 31 May 2016. SARS requires that the reconciliation is submitted through e@syFile, but an exception is made for employers with a maximum of five IRP5/IT3(a)’s for the tax year - such employers can still go into a SARS branch where an agent will help them capture these IRP5/IT3(a)’s and the EMP501 (but be warned that the queues at SARS branches are often long at this time of year).

In compiling and completing the details for filing, it is important that the information for all employees is correct on the IRP5’s (and the IT3(a)’s where relevant). It will be the employer that SARS will require to correct the data if the data captured is incorrect. In this regard, please note that the same information is required whether or not an employee is still employed by you at 29 February 2016; so, be sure you have the correct details for those employees who left during the tax year as well. [SARS will not allow employees to correct the data manually on their personal profile and they will not be allowed to file their personal return.]

Our strong advice to you, in order that you avoid unnecessary hassle, is to double-check the personal and financial data with all who have been employees of the organisation in the tax year before submitting the annual reconciliation and IRP5’s or IT3(a)’s to SARS (see list below of employee information required). It is also a good time to confirm who the employer’s representative is for SARS purposes – sometimes this responsibility changes during the year.

The following is an extract from SARS' notice to all employers:

"1 April 2016 - Employer Annual Reconciliation

Employers are required to submit their Pay-As-You-Earn (PAYE) Employer Annual Reconciliations between 18 April and 31 May 2016 to SARS, confirming or correcting payroll tax amounts which were declared during the 2015/2016 tax period.

This year, employers are urged to accurately verify and update each employee’s personal and financial details before submitting their Annual Reconciliation Declaration (EMP501) and Employees Income Tax Certificates [IRP5/IT3(a)’s] to SARS.

Should these details be incorrect on an IRP5 certificate, the employee will be unable to file his/her Income Tax Return for Individuals (ITR12) during Tax Season.  Individuals will no longer be allowed to make any corrections to pre-populated IRP5 details on their returns.

In cases where details are incorrect, employees will have to revert to their respective employers who will need to make changes on the IRP5 and re-submit these to SARS. This process can be time consuming and it may become problematic for employees to file on time.

Employers play a very important part in the income tax cycle which effectively starts on 18 April with the submission of the annual reconciliations. We rely on your cooperation to make the submission of ITR12’s later in the year as stress-free as possible for all involved."

If you need help, you are welcome to contact us (but please note that we will charge for the support provided). Alternatively, you can call the SARS Contact Centre, on 0800 00 7277, or refer to the SARS website using the link below: http://www.sars.gov.za/TaxTypes/PAYE/Pages/What-is-new-in-PAYE.aspx


Footnote

Employee details required:

·        Surname

·        First 2 names

·        Initials

·        ID number

·    Passport number / country of issue [not required where valid ID number provided]

·        Date of birth

·        Income tax reference number

·        Contact email address

·        Home & business telephone number

·        Work fax number

·        Cell number

·        Employee residential address

·        Employee postal address

·        Employee bank account type (current, savings etc.) – this is the account into which remuneration is paid

·        Account number

·        Branch number

·        Bank name

·        Branch name

·        Account holder name

·        Account holder relationship (either own, joint or third party)